The US Securities and Exchange Commission announced Friday that it has finalized new regulations requiring executives and directors at foreign corporations listed on American stock exchanges to reveal their shareholdings and trading activities. According to the SEC announcement, these requirements take effect March 18, 2026, eliminating a previous exemption that allowed foreign company insiders to avoid the same disclosure requirements faced by American company officials. The regulations stem from the Holding Foreign Insiders Accountable Act (HFIA), which Congress passed on December 18, 2025, representing another step in what appears to be increasingly strict oversight of international companies operating in US markets. As reported by Blockonomi, the SEC met the HFIA Act's mandate by adopting these amendments ahead of the March 18, 2026 effective date, demonstrating compliance with the statutory deadline.
The regulations apply to what the SEC labels foreign private issuers, companies based overseas with certain shares that trade in the US but also have certain breaks on US disclosure and reporting requirements. As reported by Newsfile SEC Press Digest, beginning March 18, directors and officers of foreign private companies that issue certain registered securities under Section 12 of the Securities Exchange Act of 1934 must start reporting their ownership stakes and trading activities. The law gives the SEC the authority to carve out exceptions for individuals, securities or transactions, with the SEC stating Friday that compliance questions remain regarding overseas jurisdictions that may already impose similar executive reporting requirements to the US. The HFIA Act mandates that the Commission issue final regulations to carry out the amendments made by the Act no later than 90 days after enactment.
According to the SEC announcement, so-called beneficial owners, those who own more than 10 per cent of stocks in a company, will not be required to report under the new regulations. However, some compliance questions remain, such as the part of the law that recognises some overseas jurisdictions may already impose similar executive reporting requirements to the US. The legislation removes a previous exclusion that had allowed insiders at international companies to avoid the same reporting obligations that senior officials at domestic U.S. corporations must follow. As per Blockonomi, the SEC amended Rule 3a12-3(b) to remove the existing blanket exemption from Section 16 entirely, replacing it with narrower exemptions covering only the Section 16(b) short-swing profit rules and the Section 16(c) short selling prohibition. Additionally, Rule 16a-2 was updated to formally exclude 10 percent holders of FPIs' equity securities from Section 16(a) requirements, ensuring that minority beneficial owners are not swept into the new reporting framework.
Under the revised rules, covered insiders must file Section 16 reports electronically and in English, marking a clear shift from prior exemptions that FPI insiders previously enjoyed. As reported by Blockonomi, the reporting process becomes more standardized and accessible to U.S. investors as a result of these changes. The rule changes also revise the relevant Section 16 report forms to reflect the new requirements, ensuring that the reporting structure matches the amended statutory framework and provides clarity on what information FPI insiders must include in each filing. Directors and officers of qualifying FPIs must begin filing Section 16 reports starting March 18, 2026, with this date serving as both the statutory effective date and the compliance start point. Covered insiders should therefore prepare their disclosure systems well before that deadline to ensure compliance with the new regulatory framework.
SEC Chairman Paul Atkins stated that these requirements will align the reporting obligations of foreign executives with those of US executives. As reported by TV Delmarva Channel 33 News, the new framework represents a significant step in harmonizing insider trading disclosure standards across different jurisdictions, particularly for companies with dual-listing arrangements in both domestic and international markets. The SEC's action brings FPI insiders closer in line with domestic reporting standards, giving investors better visibility into the trading activity of foreign company insiders and strengthening the overall integrity of U.S. equity markets. In the previous year, the SEC initiated regulatory proceedings that may force numerous foreign corporations to provide enhanced disclosure information to investors, addressing what regulators described as a regulatory gap that particularly favored Chinese companies. The HFIA Act has prompted the SEC to adopt final rule and form amendments under Section 16 of the Securities Exchange Act of 1934, requiring directors and officers of foreign private issuers to disclose their holdings and transactions in equity securities.